Inter Vivos Trust

A living trust (sometimes called an inter vivos trust) is one created by the grantor during his or her lifetime, while a testamentary trust is a trust created by the grantor's will.In a testamentary trust, property must pass into the trust by way of the will and, thus, must go through the probate court process.

As of January 1, 2020, 34 States have enacted a version of the Uniform Trust Code (Alabama, Arizona, Arkansas, Colorado, Connecticut, Florida, Illinois, Kansas, Kentucky, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Jersey, New Hampshire, New Mexico, North Carolina,

Individuals with taxable estates should consider tools to reduce and eliminate transfer taxes for them and for future generations. Family business owners are great candidates for dynasty trust planning.

Dynasty Trusts Last Almost Forever Historically, a dynasty trust could survive until 21 years after the death of the last beneficiary who was alive when the trust was established (called the rule against perpetuities).

With an inter vivos trust, the assets are titled in the name of the trust by the owner and are used or spent down by him or her, while they are alive. When the trust owner passes away, the remainder beneficiaries are granted access to the assets, which are then managed by a successor trustee.

In Texas, no creditor protection is allowed if a trust is set up this way. 2) Delaware allows for a partial dynasty trust (a trust can last for 100 years for real estate, perpetual for personal property.)For this reason, Texas is known as a debtor haven. 4) Delaware has a state income tax whereas Texas does not.

In order to set up a living trust, you should first create a document stating your intention to create a trust, and name the people who you want to benefit from the trust. You should then create another document that states the property that you want to begin the creation of the trust with.

The top tier states for dynasty trusts are Alaska, Delaware, Nevada, and South Dakota because they allow dynasty trusts and do not impose state income tax on trusts.

So, wealthy people from across the United States can open dynasty trusts in these states, with the help of a qualified estate planning attorney. These are just a few reasons why a dynasty trust can range from $3,000 to more than $30,000 in cost to set up.